Telstra's new man wins rural praise

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The naming of prominent Victorian farmer Donald McGauchie as chairman of Telstra has added impetus to Prime Minister John Howard's push to win rural support for the full privatisation of Australia's biggest company.

Coalition MPs in key regional seats welcomed yesterday's appointment of Mr McGauchie, a former National Farmers Federation president, to take the chair at Telstra after the sudden resignation of Bob Mansfield in April.

The Government hopes the country credentials of Mr McGauchie, who comes from outside Bendigo, will ease concerns that a fully privatised Telstra would neglect rural Australia.

Mr McGauchie, 54, joined the Telstra board in 1998 and holds directorships in several other prominent companies. He is also a member of the Reserve Bank board.

His appointment comes as Labor prepares to campaign in key regional seats at the coming federal election against the full sale of Telstra.

As Mr Howard yesterday reaffirmed his commitment to selling the Government's 51 per cent stake in the telecommunications giant, prominent National MP Ian Causley welcomed the new chairman.

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"Who owns Telstra is not the issue, it's who is running the company and making sure the money is spent in the right places," Mr Causley said.

Another NSW National, Kay Hull, one of the Coalition's most vocal opponents of the further sale of Telstra, also welcomed the appointment. "I still remain 100 per cent absolutely opposed to the sale of Telstra regardless of who the chairman is," Mrs Hull said, "but if the sale of Telstra goes through, then it would be very good to have someone like Donald McGauchie in control to make sure rural people are looked after."

Mr Tanner also accused Mr Howard of engineering "the appointment of a chairman who is deeply involved in factional conflict on the Telstra board and whose credentials for running Telstra are political, not commercial".

But Opposition Leader Mark Latham said Labor would work effectively with Mr McGauchie. "We'd obviously be wanting to work with the Telstra board and other statutory authorities and boards as we make the transition to a Labor government," he said.

Mr McGauchie expressed commitment to the current Telstra management.

"I look forward to working with the board and the CEO, Ziggy Switkowski, to implement the strategic direction outlined in the board's recent capital management statement," he said.

"Telstra has reached an important phase in its development - our great challenge now is to deliver shareholder value."

Tolhurst Noall senior analyst Marcus Padley said: "I think (the appointment) is good for the stock in the sense that the strategic extravagances of Ziggy's mind will not be expressed so easily. He won't have such a sympathetic audience any more."